Evan Lucas, a market strategist at spread better IG, forecast on Tuesday that more selling could loom.

"With very little on the macro news front, and the U.S. earnings season not starting in earnest until Friday, the bears are likely to overwhelm most of the overvalued stocks on the Nasdaq in the next three days," Lucas said in a morning note.

In Russia, stocks on the blue-chip MICEX index closed higher by 0.2 percent on Tuesday, despite reports of further violence in Ukraine. Reuters said on Monday that a Russian soldier had shot dead a Ukrainian naval officer in Crimea, citing a Ukrainian navy spokesperson.

Meanwhile, Russia's Foreign Ministry has warned of the possibility of a civil war if Ukraine did not stop its "military preparations."

On the data front, France saw a modest improvement to its budget deficit in February, according to data published on Tuesday. The deficit fell to 25.7 billion euros ($35.3 billion) for the month.

The U.K. economy continued to show recovery, with the release of industrial and manufacturing figures on Tuesday. Both metrics for February came in better than market expectations, and were also better than the month before.

Meanwhile, U.K. insurance stocks took another hit on Tuesday, due to the ongoing fallout from a March 28 report in which the Financial Conduct Authority (FCA) appeared to suggest a vast sector review would take place, raising concerns that firms would be badly hit. The FCA soon clarified its comments, but Britain's insurance industry is now urging the regulator to hold a independent inquiry into the leak.

Chris Tinker, founder of Libra Investment Services, discusses the sell-off in U.S. markets and says it was not triggered by concern over the underlying economy.

In stocks news, Nokia shares rebounded after Monday's selling, as regulators in China approved the sale of its assets to Microsoft; shares provisionally closed higher by 5 percent.

German sugar producer Suedzucker saw its shares finish the day down by around 20 percent after it warned of a profit drop in the year ahead.

Shares of U.K. retailer Sports Direct fell 9.2 percent after founder Mike Ashley reduced his stake in the firm, selling 25 million shares. This helped push the FTSE 100 to a two-week low during the session. The index provisionally closed down 0.6 percent.

One of the biggest fallers of the day was the building materials group Saint-Gobain, which closed down 3 percent after French insurer Groupama sold its 1.8 percent stake in the supplier.